tv.org. sunday night on afterwards. biochemi biochemist silvia terra looks at body fat. she's interviewed by a medical reporter for the new york times. >> you told there's a set point and your brain sets how much your weight is, does it change when you get older, what happens to it? >> that's the age and almost a force of nature that we accumulate fat and as we age we lose a lot of fat busting hormones, the stuff that helps rebuild tissue and kept our fat metabolizing. and testosterone, men and women, you can't eat like you did with 22 it's going to make you fat as you get older. it's not just the level of fat, it's the distribution affected as well.

>> sunday night at 9 p.m. eastern. enter aisle or some of the things we've done in years past. there there are lots of people around with microphones. the authors happy to take questions. john tamny is with us courtesy of paul and barbara paul. he is senior fellow at reason foundation, a senior economic advisor in research and trading and an editor of real clear market.com. he frequently writes about the securities market along with tax, trade and monetary policy issues that impact those markets for a variety of publications including the wall street journal, investors business daily, financial times, national review >> savan >> frequently writes about

the securities market along with tax and trade and monetary trade issues that impact the market's including dole street journal investor's business daily financial times, "national review" and the london dailies telegraph please give a warm welcomevannab to join tammy. [applause] >> thank you very much for the gracious introductionha and thanks to all of you for being here today. passionate but people like you make it possible for me to get to do what i love so i cannot express my gratitude to death i also want to thank the savannah book festival for including me as i look at the other

authors and the books featured this weekend i cannot believe i and in suchch good company with authors i have read for years volume clicking my heels appear right to be a part of this so thanks to the excellent festival for all the work they have done to make it possible for me to be here also not literally but i do believe she moved mountains to get me in a position to be here today so i am forever into her dead and her husband to is an audience today quite simply there would not be a book called "whneeds the fed" if notor hl he knows about banking and credit could filled many thick books and his been so patient in discussions in person, e-mail, phone and if i had not discussed all of

this with paul warning so much from him third never would have been a reason to write "who needs the fed?" the first place so with big thanks to haul so before i get into the book i will talk about my background i was born in charleston south carolina and not too far from here my dad was in the nuclear navy serving under the great admiral once he got out of the navy we lived in dallas and atlanta and boston for two years to go to business school then be moved out to los angeles erupted pasadena's california. during preschool in noticed what i would be doing in terms of writing about economics and economic policy these little children's books about presidents like me to thomas jefferson, george washington and ben franklin and i would read them over and over i

would be off to the side and reading the books i went to my parents one night and said i agree i enjoyable at school i an notwh participating possibly parents we to the teacher in she said niobe are thrilled please have him continue so it was probably signaling something ahead so for college and went to university of texas but not for any good reason ridges because that seem like the most interesting major at the time i cannot say i learned a whole lot i think most kids that is generally what they do as their focus is elsewhere. after college and working in sales and went to printer built to get my mba. was o while there i decided that

any to get into equities like everyone else and it took a job at goldman sachs. and that is where my future career took shape while other people were on the trading floor passionate about equities, i was look around to watch cnbc and my focus is on the economistought a talking about the economy.d i but what intrigued me was the constant stream of commentary in the latehe nineties saying that if they grew too much tuned if people prospered to much creating companies there was a negative downside to cause inflation. so i thought i grew up in the '70s it is a devaluation of the dollar and inflation is something that occurs

exclusively if economic growth when economies are growing and the investment surges so the price of everything drops. from history i remember the first mobile phone motorola half hour battery lifeop in making a call would cost a fortune and roaming charges so now i thought you could get a phone for fraction of fee price in did you from history the first mainframe was created by a i ami costing over $1 llion even by the late nineties hugh to get a pretty good one at adi few thousand dollars now today a few hundred but that is the persistent drop ofi everything thanks to investment. everything that i looked rejected the common view ofu economics that somehow the

growth was a problem to planet so we do not prosperr enough's. goldman sachs was full of talented people but they were very specific you did your job bid to -- don't go outside by secretly started to write for the clients commentary by your seeing and reading is against common sense and economic history so i thought this isco what i really want to do and by 2001 the stock market started to dive back thatat they referred to as the internet bubble popped. the u.s i will settle think there's such a thing as the bubble that run-up in internet stocks was beautiful as a sign of economic progress as was the decline of those companies but when there is

a lot of failure been yugo the economy is progressing you need that constant experimentations of people look at it as the negative but i look at it when the world and the economy were transformed by advances we could not live without.because so of the downside in the internet economy was suddenly goldman sachs was not as interested in my service is as they had been a few years ago. [laughter] that was rather devastating at the time you srt to question in your cell forel saat kind of a person youu are. and my doom for failure? it was the best thing that ever happened to me becauseng i fought to comment on the economy.

i am not an economist i'm not a journalist either butgoino i have to write about this it would paid been not to be in the field of commentary so of the negative live goldman sacks forced me to figure out what i wanted too do so i move to washington d.c. not as any economistother e and to pay the bills media the donors and that is how iso met hall mcadams and how wide transform glove world and and within economic conventator. but the initial online columns which is the duty of

the internet society can as a writer for washington d.c.. no longer to have been association but i developed a reputation that was up with working against or contradicting conventional wisdom and felt that profession had lost its way.expi and people don't dislike economics they justice like hell with has been explained to them so if people could see the beautiful world around them sports, movies sports, movies, television they would understand all they ever need to know so that has been my style off writing all this time. my first book popular

economics you should buy several copies of later today laugh laugh explained economic growth and been through movies and sports and television getting rid of the graphs that is thsential. and who needs the of said? in to explain central banking and what people can understand that has been my goal from all of this the economics is fun with a have taken the fun out of it leading to the book "who needs the fed?". of one to stress up front don't be fooled by the title or the coverage is a very optimistic book that argues the fed was nearly never or influential as was assumed or even better the market forces will rapidly with

under the federal of the right before our eyes. but it has no resources it cannot increase credit or shrink credit it kennelly miss out we have already created. the fed is large not because of the talent of people but it isn't active in the markets because the people there have a specific skill that others don't have remember there are central banks in nigeria, a cayman islands, barbados, central banks are everywhere we have one because of the american people are the most economically productive people one earth. the fed swagger is not its own. the his the by a point of my book when you talk about the fed we misunderstand the of credit mcanally misallocated

resources sandy argument i make is be vastly overstate livi how much the fed misallocating. is just not that important. i am a big believer of market forces the way the electorate is there's a lot of skepticism right now in the world about the central bank and there is some skepticism on the of misperception and that the world that the fed gives it is not defined by reality. popularized by economist politicians and pundits that many and credit are one in desks,me. and we could not be morere different if the with the same heydey in honduras would have as much credit flowing through their economies as we do.

counterfeiting would not own the be legal but broadly encouraged. credit is a real economic t resource. when you borrow dollars desks, chairs, buildings and labor we are the credit we are the of producers that when people seek to borrow dollars to the fed has no private stash of resources over here we are the creators. the frustration with the fed is somewhat separate them watch the pundits will the fed tightened credit or keepd it at 0 percent put excite think the electorate properly looks at that that

does not reflect what weed know. apple computer even pays 3% to borrow.inking anyone who owns a small business kno to obtain credit cost more is much higher than 3 percent going higher all the time. 13. that is the broad point of the book. while claiming easy access to credit react as though with does not exist that is a positive statement from noere we are. is a real talented movie producer in the history ofil the industry talking about /. km. path to like empire or 24 or "arrested development" but

but to take those movies or ideas failed 90 percent of the time. with a perfect track record hollywood is the land of no.me what about silicon valley apex but as evidenced by the billionaire venture capitalist we know it is expensive if you want to fund your startup idea youwi give a big portion of your business been even more with the stock options would attat investment banking? , the media members have made will street a pejorative.

i cannot think of a more important profession thanny investment-banking to deal with the basic truth it is one thing to come up with ane. idea for your business or to o expand your business but to obtain the resources and credit to build on the vision so they are paid very well because they can do for business is what they cannot do for themselves. as many remember the name michael milken he spent timed in prison for charges thatis have never been prosecuted on anyone before. he is one of the greatest capitalist who ever lived. and ed is in sight in the '60s and '70s unless you were the bluest of blue-chip you were shut out and theed

traditional banks did not regard you as a reasonable credit risk. saw his genius in the source of his fortune was the high-yield bond that was his way to find more expensive credit for promisingth businesses like time-warner time-warner, cnn, the golden nugget. those of the great businesses that he attend -- to obtain credit for. his fortune was a function of the fact that while the fed's were declaring easy credit he founded for a difficult credit source. is hard to obtain credit in the real economy which brings us to the 45th whesident. i like to sell books sweat like to have stories about people who are free masai. believe it will drive more people to buy it as you all should. [laughter] this is not a political

statement bayou may remember he reached his height as a real-estate mogul in the '80s the man who do no wrong for what the future of tall buildings would be.st as early as 1990 he was viewed as a major credit risk. i tell the story he flew out to a seedless to meet withan the fifth largest u.s. bank and wanted to borrow $50 million to fund the revitalization of the ambassador hotel. as you can tell he of five full of confidence and swagger with his amazing balance sheet of assets ofmi the best properties on earthated highly liquid.d. the best landing option that you had why would you you should give me 100 million. the bankers have been entirely different view of

his assets. that if people and into a difficulty they would not be easily sold so his requestateme, was refused in the london 10 million. did not want to be associated with the celebrity of lived to regret that to years later he didn't pay one dime backd add. because they wrote down the loan he was viewed as toxic. that is not a political statement but about credit. so while the fed is over here to declare zero rates of interest in the real economy they go up and down as if the fed does not exist a hugely positive statement

of the economy that i would add. if the fed refraction of powerful as assembly would not be the richest nation on earth. it is just not that consequential. the justice not influence the flow of credit or influence as much as people think. if there is such a thing as easy credit. and that is very positive.d as s do we need a federal reserve for central bank? as you can guess my take isac we don't need one if the fed were shut down tomorrow, if you would notice. they began when hundred years ago in 1913 as a lender of last resort to then-

solvent to bank.well-run b if your will run with excellent assets running into like cash crunch the fed existed as a source of a loan to tide you over until the cash came back. but as we've seen it is unheard of for a solvent bank to go to the fed for of all this in addition of bankruptcy because there of marietta of non fed sources of credit willing to lend to a well-run bank purposes this is meant that the fed has existed to weaken as a member of last resort to thest insolvent banks. imagine that with silicon valley if that is a central authority to bailout your weakest companies.

thatcon valley would be very rundown impoverished but this is where the businesses died the fed has weakened the system to prop up the weakest at the expense of the most successful banks for, the fed and this will offend if you view of what a laughable presumption if you work at the fed that is generally a sign you cannot get a job at a bank in the first place laugh laughh asking those to police those who have much more. but with the regulators in regulations we're asking thehe impossible.the bank and asking them to see into the future urd to detectnks lend those troublespots before problems arise. if they could do that they

would be earning billionsovernih quite literally the richest investors in the world even the smartest foliate met the majority of the time so withis regulation we're asking the impossible that it is very expensive but achieves lessou than nothing. but then the fed firmest -- famously targets the rate of the fed funds rate interest rates are priced like any either to easily set the price of said targets and does not said anything. so what serves no useful purpose if we ended the fed but i fully accept the mia and view is a bit on the outside. that it could not function without a central bank were utah qingdao? we would be any nonstopp

depression road. don't you know, ? then i point out rockefeller became the richest man in the world before the fed. but it is constantly rejected the very idea to say we don't need a central bank. the arguments are many keynesian school makes the point about the then we needed to increase creditng during recessionary periods to prop up the economy in free fall. this fails because it cannot be forgotten and as agonizing as they are or killed morale in the year term that the others -- signal on the blade because they seek because of all the misuse of labour and the bad

habits and into investmentsat that was holding the economy :own in the first place. so that is the sack time when government to do less did nothing simply because if left alone they seville the boom on the way quick spin mckuen them to try to allocate credit but that companies are propped up of hicks periods but the fed has no credit to increase. and those said kennedy's in tuesday economy in kennelly increase that m&a act to

fight aggressively in factive fights the recovery because it is instantaneously misallocating the resources that would be pushed to a higher use usually to what has already failed to the detriment. so to monitor it is a more limited view of with the federal reserve should do. are giving it should control the money supply and a set and to be most associated with this view to explosively cannot promote it is basic money-supply is never a problem on the veryim

best did their to unproductive people for such as they are a magnet for credit to obtain the creditfailt so imagine a city that is suffering economic problemssinel like baltimore and maryland. because the fed believes it can stimulate economic growth with the monetary policies and then agenda of then decides to stimulate baltimore and proceeds to

buy a of treasuries from the banks to increase the funds. such a scenario would fail between breakfast and lunch simply because they cannot stay in business lending to individuals that lack the means so increase of that dollar credit would leavent those outside the state itself. into a grand guys themselves but they're always looking to solutions so the latest did in the past years talk about helicopter drops of money. they're notag lirallabout the fed dropping helicopter money into cities but let's produce money on mass butba

they do have an airforce so let's imagine a drop of billions of dollars on to the city of baltimore and imagine something more realistic the citizens would pick them up to spend them right there. such a scenario would fail because even if they spend every dollar in new business will expand based on a helicopter dropped then it cruld be rapidly lead doubt now actually economists say you're not an economist central bank's focus on countries. okay. several years ago when greece ran into economic and trial monitors hansard thehe insert is for the ec be to increase the supply of drams

this point negative euros but activity did not rate increase money and credit so any supply would boomerang back to germany so now let's reverse this in there and think about a place that is known for welfare and s productivity. and the fed believes right up to the top the economic growth caused inflation. you heard me say that already bent those two areic charged with planning our economy actually believe prosperity has aownside but it must neuter economic growth to put people at of work to slow down the economic growth to cause inflation.instanta

quitto save weevil's dart selling to decrease the supply. >> and would because be recited a global economy savers and investors are desperate for exposure to the productive people on earth if they shrink the supply in the be made up instantaneously by thehe sabres around the world but the fed put simply cannot increase money and credit that are struggling in much the same as productive and bear fighting now my book is

the explicit tribute to the classic cookbook the theory of money and credit but despite that i m very critical of what i term as modern austrians have made the argument that major of the 20th century were the creation of uneasy peace central putting us on the sugar high-end trot tightestusts move breitbart put to create easy credit of a flight is it because the keynesianal

swill say to stimulate the his for terrorists because o politicians republicans arent democrats can allocate precious reserves and so why is it can and widely believed essential banks can one to make aco instantaneously injured the economy because resources are allocated in the non economic fashion. there is not even a near-term for your

central-bank but in terms of access strengthen and since it shifted. when you borrow money byby resources for handbags that this but despite their efforts to make the credit easyndocus help rates that reflect reality is a very positive steven improve the fed is just a lot that importer and dennis eckersley but it is the chance but the response by

edison and his -- and interesting theory but what about quantitative be seeing?tgages to to stimulate the major but what you believe is belied by common sense. now with quantitative easing we will talk about that economically first the fed borrowing $4 trillion to and also but quantitative leasing had nothing to do with economic growth. as the rule in begin to the economy and that is the case because governments once again cannot spend as toto

prosperity but only this allocate the wealth we have already created. as for housing it is not the driver of economic activity. purchasing a house to settle the four markets are making you more productive to does not lead to softer innovations. housing is consumption to reduce the amount of capital available to expand so on the face it was in economic depressant not a driver of grth that which point to believe this stimulated the stock market boom you have to belve that the deepest markets in the world populated by the qusophisticated investors were tricked by something to economic growth the very

idea of friends will be oure about. but they can check the smartest markets in the world?can you ex one of my a famous ones came from the economist but the fed conducted quantitative evening -- easing that we have your back and will keep the markets products of and i hope by alertness ramon will build morey laureate this the great point butd did is police say is true explain to me to pay and because the central bank has force no fewer than 11 quantitative easing with zero corresponding stock market rally are been for nike and janet yellen ultimately t

incompetent and the response that you get from that but you don't understand what the fed did was push down interest such that people had to get into equities the embassy only place to get healed so that is an interesting theory except to help you explain japan because it is hell of lower interest rates over decades but the stock market is half of what it was 1989 for also why didn't the stock's rally rod when the fad was aggressively pushing down the rates the stocks went into free-fall was alan greenspan not as skillful asd been burnett keep blacks and then they say you don't understand what happened was the fed in conducting quantitative easing drawdown

the yield on the bond so much that equity was silly game in town.ere to go a very interesting theory but then there bush have been a massive correction in bonds reflecting some of the only major occurred is that i don't see your argument. please explain. the fed created partially in dark -- that had to create its way to the stock market. did not create a $4 trillion but you can believe that. but for that to ensure the stock market for trillion dollars must exit.c in this nother world inhabited by academics put the buyer to expressth optimism a seller must

express pessimism. into express that view they must get to express a pessimist so horrible to be i optimistic in nests show pessimism and day equal eachh other out at which point we get to the basic truth about the markets themselves. quite simply do not price in the present but always the future. the friends official program ended 2014 but isn't it deafened keep the head and the logic then the stakes would have corrected for a good but stocks have

continued to watch new highs . there is quite but that the fed created a scene where it he doesn't know what he is talking about and he be says alleviate bv is a hidden -- but i fully agree that i am on the outside of this making a different argument. but if you believe the fed despite all evidence was the source of a major stock-market rally what youwh must slow to signal any

economy cleansing of what has not insinuate but it is within the fifth mrs. r. b. directed from a poorly run businesses. so if in fact, the fed was the source of the rally kept precious resources at the expense of much better ones robbing us of a healthier and higher stock market. that is the purpose of my book to unmask the fed. isn't that consequential. i say what is an and defense i have no belief that the fed will ever end